China’s Banking Sector Reports Steady Growth in 2023

China’s banking sector experienced consistent asset expansion throughout 2023, according to a spokesperson from China’s National Administration of Financial Regulation. The financial institutions in the country’s banking sector witnessed a notable 9.9 percent year-on-year increase in assets, reaching 417.3 trillion yuan (approximately 58.7 trillion U.S. dollars) by the end of last year. This announcement was made during a press conference by Liu Zhiqing.

Despite the expansion, Liu emphasised that the asset quality of these financial institutions remained generally stable in the same period. Notably, outstanding non-performing loans (NPL) amounted to 3.95 trillion yuan by the close of 2023, with the NPL ratio standing at 1.62 percent.

Preliminary data also revealed positive financial performance for China’s commercial banks, as they reported a net profit of 2.38 trillion yuan, marking a 3.24 percent increase from the previous year. Additionally, the provision coverage ratio, serving as a safeguard against financial risks, was notably high at 205.1 percent.

Looking ahead, Liu expressed confidence that China’s banks would sustain their steady growth momentum in the coming year, with a focus on further optimising financial resource allocation. He underscored that the country’s solid long-term fundamentals would persist, anticipating that the continued improvement in fundamentals and the emergence of new growth opportunities would contribute to the ongoing development of the banking sector.